222 Smith Hollow Rd

Church Hill, TN 37642

$125,000D

2 bd · 1.0 ba · 960 sqft · Built 1945 · SingleFamily · Active · 6 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,110/mo
• Mortgage (P&I): −$656
• Tax + insurance: −$147
• HOA: −$0
• Vac / Maint / Mgmt: −$233
• Net cashflow: $74/mo
• Annual: $891/yr
• Cap rate: 7.64%
• Cash-on-cash: 4.82%
• DSCR: 1.21
• 1% rule: 0.89%
• Cash to close: $35,000

Investor read

• This is a 2-bed/1.0-bath single-family listed at $125k.
• At list price, monthly cash flow is $74 ($891/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $111k (11.2% below list).
• Only 6 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $111k (11.2% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $864 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 71/100 on livability (#42 in TN) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, housing A+; Watch: employment D+, amenities F, commute F.
• Hawkins County (rural): math 23% / reading 26% proficiency, ranked #93 of 139 in TN (top 67%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Zoned schools: Church Hill Middle School (math 24% / reading 22%, grade F, #168 of 333 statewide, top 51%, 350 students, 0% FRL); Volunteer High School (math 19% / reading 37%, grade F, #101 of 332 statewide, top 30%, 1,045 students, 0% FRL) — zoned schools average 0% FRL vs 57% district-wide (57 pts lower); this property's tenant base skews higher-income than the district average.
• Watch-outs: flood insurance adds $66/mo; built in 1945 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 125 active listings in the ZIP; 151 units permitted in Hawkins County in 2024 (0 in 5+ unit buildings).
• Hawkins County population projected at -17% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• Current owner paid $12k; list at $125k implies a 933% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: severe flood risk; extreme-heat days projected 7→22/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 7.6% vs local median 3.6% in Church Hill — top-decile yield for the area; either an underpriced asset or a hidden risk that comps aren't pricing in. Stress-test before assuming the spread holds.

Questions for listing agent

• Built in 1945 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are F-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• The area grade is low — what's the realistic commute time and amenity access for the typical tenant pool here? Any planned neighborhood developments (good or bad) we should know about?
• What's the average days-on-market for RENTAL listings here right now (not sales)? A rising rental-DOM trend means longer vacancies and softer asking-rent achievability than the comps imply.
• What's the recent tenant-quality profile in this submarket — average credit score on applications, eviction rate, late-payment / NSF rate, and stable-employment percentage? A property-management company in the area should have these aggregated.
• How much new for-sale + rental construction is in the pipeline within 1–3 miles? Heavy new supply typically softens prices + rents 12–24 months out; constrained supply supports both.